Gregory Reyes, the first chief executive to be convicted in a stock-option backdating trial, was sentenced today to 21 months in prison for his role in an illegal backdating scheme at San Jose-based Brocade Communications.

Reyes also was ordered to pay a $15 million fine.

The prison sentence, to be followed by two years of supervised release, was stayed pending appeal of the case.

The punishment handed down by U.S. District Judge Charles Breyer was clearly intended to warn executives about the consequences of breaking securities laws and lying to investors.

"What this case is really about is the failure of a CEO of a publicly traded company" to fully disclose important financial information, Breyer told the packed courtroom. "It is about lying to his company.

"Corporate fraud is not a victimless crime," said Breyer. Not only does it affect the economy, but "as we've seen with Enron, people's life savings." He reiterated that corporate executives "must speak the truth about financials."

But having read almost 400 letters on Reyes' behalf citing the former CEO's generosity and his anonymous help to the less fortunate, the judge said he reduced the minimum sentence that he could have imposed.

"It's only fair to give some recognition for his extraordinary acts of generosity," said Breyer. "He is the essence of what you want to see of an individual to whom much has been given and who has given much."

Nevertheless, the sentence left the courtroom stunned.

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In a tearful plea for leniency - at one point, Breyer called a five minute recess to allow Reyes to regain his composure - Reyes said he vowed to learn from his experience.

"I am sorry. . . . There is much that I regret and if I could turn back the clock, I would have done things differently. I will try every day from this day to re-earn the trust that was placed in me.

"I've tried to lead a good life. This experience has humbled me in more ways than I can express in words, but I am determined to learn from it."

Outside the courtroom after the hearing, Reyes - dressed in a black suit, blue shirt and orange tie - was hugged by relatives and supporters, including former investment banker Frank Quattrone, who beat obstruction of justice charges. Reyes said he respected Breyer and the sentence, but said he intends to file an appeal.

Breyer today told the courtroom that he would have given Reyes a sentence of 15 months. But in a past court filing by Reyes requesting that his trial be separated from that of Stephanie Jensen, Brocade's former vice president of human resources, Breyer said Reyes had lied and in the judge's opinion, obstructed justice. That persuaded Breyer to increase the sentencing level.

Breyer also said that he stayed the 21-month sentence because if the case was reversed on appeal, it would be unfair for Reyes to have spent that time incarcerated.

Prosecutors had asked for 30 to 33 months prison time for Reyes, along with a hefty $41 million fine and nearly $90 million in restitution payments, mainly to Brocade, for its expenses and losses caused by the case. Brocade paid for Reyes' defense, which cost at least $46.7 million.

A jury of three men and nine women spent six days in August deliberating the case, before returning a guilty verdict on 10 criminal charges, including conspiracy and securities fraud. It was a shocking verdict and sent a chill through the Silicon Valley, where dozens of companies have had to restate earnings because they backdated stock options given to employees and failed to report it in filings with the Securities and Exchange Commission.

Today's sentence is likely to do the same.

Reyes, 45, was the archetype of a Silicon Valley CEO, pouring long hours into promoting his company and pitching its products around the globe. He became its chief in 1998 at the age of 36 and took the company public in 1999. The company pioneered networked storage equipment and it grew rapidly during the late 1990s, with its stock soaring, reaching a split-adjusted high of $133 in October 2000. The stock nose-dived with the bursting dot-com bubble and was trading at $6.46 today.

Like many Silicon Valley companies, Brocade used grants of stock options to reward employees in a competitive job market. Options are a right to buy stock at a set price and sell it at a later date. When the stock rises in value, the shares can be sold at a profit.

Reyes was accused of fabricating grant dates at which Brocade's stock was lower than it was on the true date of the grant, increasing their potential value. That did not break the law, but failing to report it as an expense to investors did.

Prosecutors said Reyes altered company records to keep investors from knowing the true cost of the millions of dollars in options he handed out from 2000 to 2004, and then lied about it to investigators when he was caught. Stephanie Jensen was convicted in December on conspiracy and falsifying corporate records in a separate trial and awaits sentencing March 12.

Reyes' appeal for leniency was bolstered by nearly 400 letters of support written to Judge Breyer, who said at a hearing last week that he had read them all. The letters portrayed Reyes as a generous giver to charity and a dedicated CEO who looked out for his employees' welfare.

In court filings, he pleaded for a light sentence because a long prison term would be hard on his children, one of whom has medical issues that were the subject of a sealed filing.

But Timothy Crudo, the federal prosecutor who won a 10-count conviction against Reyes last August in the first backdating case to go to trial, said Reyes spent more time on the road and working at his company than he did with his children.

New York prosecutors in February actually snared the first two guilty pleas in the stock options backdating scandal when the former chairman and chief executive of the maker of the "Grand Theft Auto" video game series pleaded guilty to falsifying records in a stock options scheme to enrich himself at shareholders' expense.

That plea was followed shortly afterward by a guilty plea from former Monster Worldwide's general counsel for rigging stock options.